U.S. Government Supports Lower Court Decision that Navy Members’ Fukushima Suit Can Proceed in United States

In March 2011, a magnitude 9.0 earthquake rocked the eastern Japanese coastline, causing 100-foot waves, massive damage, and nuclear meltdown at the Fukushima-Daiichi plant. The following day, the U.S.S.Ronald Reagan arrived near Fukushima to carry out Operation Tomodachi (“friend”), a $90 million humanitarian assistance operation. In a class action lawsuit filed in the Southern District of California, U.S. naval service members and their families allege that they were exposed to dangerous levels of radiation during this operation, and seek damages from the Tokyo Electric Power Company (TEPCO), which owned and operated the six-reactor nuclear plant. District Judge Janis Sammartino initially dismissed the suit as non-justiciable under the political question doctrine, but allowed an amended complaint to go forward. TEPCO appealed the denial of its motion to dismiss to the 9th Circuit.

At this stage, the major dispute in the case concerns the forum rather than the substance: should the plaintiffs be permitted to hale TEPCO into American courts, or must they sue in Japan, where such claims can be submitted to a Nuclear Damage Claim Dispute Resolution Center set up by the government? This question, however, implicates sensitive issues of sovereignty and competing national interests, pitting members of the U.S. military against a company that was essentially nationalized by the Japanese government after the crisis. As the U.S. government’s brief explains:

This case thus touches upon strong U.S. interests, both because of our Nation’s enduring relationship with Japan, a longstanding and essential ally, and because plaintiffs in this action are members of the U.S. military allegedly harmed while deployed on a humanitarian mission, and their family members.

At the request of the 9th Circuit, the United States entered the case in December as an amicus to clear up questions at stake relating to the U.S. interests. During oral argument last September, TEPCO’s counsel had suggested that the U.S. government’s interests favored dismissal of the case in preference for a Japanese forum, consistent with a general policy of centralization of claims for nuclear third party liability in the country in which an accident has occurred. The panel seemed skeptical about this suggestion. In fact, though the U.S. government’s brief was in support of neither party, it urged deference to the decision below, stating “[t]he United States has no specific foreign policy interest necessitating dismissal in this particular case.” In light of this development, the court granted both parties an opportunity to submit supplemental briefs in response and has not yet issued an opinion.

The U.S. government’s brief walks a fine line, at times reading more like a diplomatic statement than a legal argument, extolling Japan as a “valuable partner” and “one of the United States’ most important economic partners and strategic allies.” Still, it notes that the Japanese compensation system is not “exclusive on its own terms,” and that the court below could have reasonably concluded that an interest in “providing U.S. service members a U.S. forum for their claims” outweighed the interest in resolving all claims in Japan.

The government of Japan’s amicus brief, filed before that of the United States, takes a stronger stance, urging the court to dismiss the claims on grounds of international comity. The comprehensive compensation system enacted by the Japanese legislature is sufficient to address all claims arising from the disaster, it argues, and this litigation could be “highly corrosive” to that system:

U.S. courts should not undermine the carefully calibrated public policy reflected in the legislation passed by the Japanese Diet establishing the nuclear accident compensation system. The irony of the situation is that this U.S. lawsuit against TEPCO is possible only because the Government of Japan, as part of its compensation system, ensured TEPCO’s solvency, including by providing ongoing funds for damage payments.

The panel will be required to weigh these national interests in its international comity analysis, but there are other factors to consider. In its brief, TEPCO argued four separate grounds for dismissal—two aimed at attacking the forum, and two at attacking the underlying tort claim as either non-justiciable or barred by a defense. General Electric (GE), a defendant in the class action but not a party to the appeal, filed an amicus brief suggesting an additional jurisdictional barrier: the Convention on Supplementary Compensation for Nuclear Damage (CSC). If the 9th Circuit panel finds any of these five arguments compelling, it may direct the district court to reconsider TEPCO’s motion to dismiss.

The strand of international comity at issue here is adjudicatory comity, under which a court may, at its discretion, decline to exercise jurisdiction over cases more properly adjudicated in a foreign country. 9th Circuit precedent dictates that courts performing adjudicatory comity analysis consider (1) the strength of the U.S. interest in using a foreign forum (including the location and character of the conduct, the nationality of the parties, foreign policy interests, and public policy interests); (2) the strength of the foreign government interest in the same; and (3) the adequacy of the foreign forum.

While some of the factors split down the middle—the plaintiffs are American and the defendant is Japanese; the accident occurred in Japan but the alleged injuries were felt in the United States—TEPCO argued that the policy interests of both the United States and Japan strongly favor exclusive jurisdiction for the state in which the accident occurred (Japan, in this case). Centralization of claims ensures that compensation systems established by a state are not “undermined by forum shopping, legal uncertainty, or improper competition among claimants.” This exclusive-jurisdiction principle was codified in the CSC, which the United States ratified in 2006, but which Japan did not join until more than 3 years after the Fukushima disaster. TEPCO argues that this principle reflected a longstanding U.S. policy, even though the CSC does not apply to the claims in this case.

The U.S. government, though, expressed concern that allowing countries to benefit from the exclusive-jurisdiction provision of the CSC before the treaty takes effect in their territory disincentives ratification, especially because parties to the CSC must contribute to a supplementary compensation fund. And the plaintiffs argued that the true motivation of the exclusive-jurisdiction provision was less noble than TEPCO suggests, and therefore should be given less weight by the court:

The “exclusive jurisdiction” was never intended to benefit either the United States or Japan, but rather to benefit corporate suppliers, designers and experts in the nuclear energy industry…. Where, as here, both countries share the same policy of exclusive jurisdiction, and that policy’s purpose is to exclusively benefit private corporations by immunizing them from liability, the weight ascribed to this policy by a court when deliberating whether or not it should cede jurisdiction, must be diminished.

GE makes a different argument concerning the exclusive-jurisdiction provision of the CSC: that it applies in this case, depriving the district court of subject matter jurisdiction. Though the treaty did not enter into force until 2015, the Supreme Court has held that jurisdictional provisions generally apply to pending claims, even when the conduct took place prior to the enactment of the statute or treaty. This is also true for jurisdictional provisions under international law. The United States disputes this claim, however, arguing that the usage of the present tense in the provision (jurisdiction “shall lie only with the courts of the Contracting Party within which the nuclear incident occurs”) forecloses its application to claims arising from incidents that occurred before its entry into force.

The doctrine of forum non conveniens also gives courts discretion to dismiss claims better suited to adjudication in another forum. Courts consider a threshold question of whether the other forum is adequate, and then balance private and public interest factors to assess whether dismissal is warranted. Judge Sammartino found that Japan was an adequate forum, but that the balance of factors weighed against dismissal. TEPCO criticized this conclusion as relying on faulty assumptions that the plaintiffs would be forced to travel to Japan to bring suit there, and that the U.S. interest in compensating service members would be better met in the United States. In contrast, the plaintiffs challenged the threshold determination that Japan is an adequate forum, arguing that the remedies provided by Japan’s compensation system are inadequate, and that they would not receive a fair trial there, given the Japanese government’s majority ownership of TEPCO:

Plaintiffs will effectively be suing the Japanese government in Japanese courts on an issue that holds significant shame and disappointment for TEPCO and the Japanese government.

Even if the Southern District of California is a proper forum, the underlying claim may be non-justiciable under the political question doctrine insofar as it requires the court to evaluate the Navy’s decision-making during Operation Tomodachi. Indeed, it was on political question grounds that Judge Sammartino dismissed the first complaint. In their amended complaint, the plaintiffs omitted claims that TEPCO had fraudulently misrepresented the situation to the U.S. military during the crisis, focusing instead on TEPCO’s allegedly negligent actions before the tsunami. Judge Sammartino sided with the plaintiffs in holding that this framing bypasses any need for the court to assess the Navy’s discretionary choices. But TEPCO argued that a decision on the part of the military to station sailors dangerously close to a radioactive source could be a superseding cause of the plaintiffs’ alleged injuries; if a court finds that the Navy’s actions broke the chain of causation, TEPCO is off the hook. In its brief, the U.S. government argued that it was premature to consider the issue of justiciability, which is inseparable here from the issue of causation, until a determination has been made concerning which country’s law should apply.

Similarly, the U.S. government declined to weigh in on the possible applicability of the so-called Firefighter’s Rule before the choice of law issue has been settled. Generally, professional rescuers cannot recover for injuries sustained in the course of responding to an emergency that are reasonably associated with the emergency, even if the injuries were partly caused by another’s tortious behavior. For example, a firefighter injured by the explosion of a defective car in the garage of a conflagrant house is barred from suing the car’s manufacturer. The plaintiffs dispute that the radioactive release at Fukushima was “reasonably associated” with the earthquake to which the servicemembers responded, arguing instead that TEPCO’s actions were an “independent cause” of injury. In her denial of TEPCO’s motion to dismiss, Judge Sammartino refrained from applying the rule outside of the context of domestic emergency responders.

The Japanese government and TEPCO have both faced criticism for their lack of preparedness and insufficient responses to the nuclear crisis, which some see as the result of collusion between regulators and the industry. TEPCO in particular had a reputation for “subpar” performance and concealing accidents even prior to the 2011 disaster, and has been accused of refusing to provide accurate information about the extent of the damage in its immediate aftermath. After Japanese prosecutors decided against bringing criminal charges related to the incident, a committee of citizens overturned the decision, leading to the indictment of three former high-level executives for “professional negligence” last year. The present question in this suit, though, is not whether TEPCO is responsible for the considerable harm caused by the nuclear meltdown, but whether the company should face litigation in a foreign court for its actions. As a matter of foreign policy, the United States has refrained from arguing that it should not.